MYTH: Higher Fuel Economy Standards Are Unattainable

Conservative media are promulgating the myths that higher fuel economy standards are unattainable with current technology, will cost consumers and will increase traffic deaths. In fact, automakers have said they will be able to meet the standards, consumers will net thousands in fuel savings, and safe cars in a variety of sizes will continue to be produced.

Wash. Times: Fuel Economy Standards Are "Unattainable"; "Only Boring Hybrids And Impractical Electric Cars Will Remain." A Washington Times editorial claimed that the U.S. government "wants to wipe out inventions it has long hated, such as the internal-combustion engine." It went on to say:

That’s why the latest proposals to raise Corporate Average Fuel Economy (CAFE) requirements are set at unattainable levels. Currently, manufacturers achieve an average rating of 30.3, but a few manufacturers like Ferrari score just 16.2. By increasing noncompliance penalties, it simply won’t be feasible to make a fun car even in low volumes. Only boring hybrids and impractical electric cars will remain. [Washington Times, 7/21/11]

National Review: New Standards Will "Effectively Eliminate The Gas Engine" By 2025. In a recent blog post, the National Review’s Henry Payne wrote: "A furious two weeks of Big Auto, Big Union, and Big Green closed door meetings and backdoor lobbying brought pressure on the Obama administration’s plan to double the fuel economy of American cars — and effectively eliminate the gas engine by — 2025." [National Review Online, 7/25/11]

Consulting Group: Carmakers Can Significantly Lower Emissions "Through Improvements to Conventional Technologies." A recent study by the Boston Consulting Group found that "Internal combustion engines are improving their ability to cut CO2 emissions at a lower cost than expected, and, as a result, carmakers should be able to meet 2020 emissions targets mainly through improvements to conventional technologies." The study was based on a potential fuel efficiency standard of 47 to 62 mpg for the U.S. [Boston Consulting Group, 7/6/11]

ICCT: "Several Studies Have Shown That Automakers Could Achieve" 56 MPG Using "Technologies Already Available." John German of the International Council on Clean Transportation, which conducts technical research on efficient transportation with the goals of protecting public health and minimizing climate change, writes that automakers could meet a fuel efficiency standard even higher than the proposed standard of 54.5 mpg by 2025 in The Hill:

Technology can move quickly or at a snail’s pace, depending on the motivation of the industry involved. Several studies have shown that automakers could achieve the strong standard of 56 mpg that the Obama administration is reportedly considering even if they only use technologies already available today — without any alternative fuel technologies coming on line at all." [The Hill, 7/27/11]

The goal of 56.2 mpg is tough, but General Motors will figure out a way to reach it, said Mark Reuss, the company’s North American president. He would not say what technologies GM would use to reach the target, but he conceded that many easier, less-costly solutions already are under way or have been done such as switching to smaller engines and developing more fuel-efficient transmissions.

"When you put those things in for the first time, they may be more expensive," he said. "But this is a volume and scale industry. What was very expensive in the past is no longer very expensive." [AP, 6/28/11, via ABC News]

Nissan: "We Will Be In A Position To Meet" The Proposed Standards. The New York Times reported:

"The standards are going to be quite stringent and a challenge," said Scott Becker, a senior vice president in the United States for the Japanese automaker Nissan. "But given the range of technologies that we either have currently or are developing, we will be in a position to meet them." [New York Times, 7/28/11]

Politico: Proposed Standards Have Industry Support Due To "Flexible Compliance Approaches Built Into The Agreement." Politico reported:

The industry support appears to be contingent on several flexible compliance approaches built into the agreement and limiting California’s ability to set its own emission standards, a right it has under the Clean Air Act.

"Automakers really wanted to see a single national program, and we believe that the White House understands how much of an economic disruption would occur from multiple standards at the state and federal levels," said Gloria Bergquist, a spokeswoman at the Alliance for Automobile Manufacturers. "So, we are moving one step closer to a single national program for greenhouse gases and fuel economy for the next 14 years."

General Motors, Chrysler, Ford, Honda, Hyundai and Nissan are reportedly behind the White House plan, even though none have spoken up publicly about the plan, according to several sources tracking the talks. [Politico, 7/27/11]

MYTH: Higher Fuel Economy Standard Would Cost Consumers

IBD: 56 MPG Fuel Economy Standard "Could Add $9,000 To A Car’s Price, Far More than" Savings From Fuel Costs. From an Investor’s Business Daily article: "The 56.2 mpg CAFE standard could add $9,000 to a car’s price, far more than drivers could expect to save in lower fuel costs, according to a recent Center for Automotive Research study. That would spur consumers to hang onto old cars longer." [Investor’s Business Daily, 7/26/11] Daily Caller: Higher Fuel Economy Standards "Would Be The Equivalent Of A New Tax On Cars." From an op-ed by Pete Sepp:

Meeting this number — or the White House’s suggested 56 mpg benchmark — over the next 14 years might not be impossible, but the stumbling blocks are bigger than many might believe. The Center for Automotive Research (CAR) authored a study concluding that a 62-mpg mandate could eventually cost consumers over $9,000 for each new vehicle. This would be the equivalent of a new tax on cars, but unlike an actual tax, it wouldn’t need congressional approval.

The only thing worse than paying more each time you fill up the tank is being forced, through a hidden "car tax" imposed by bureaucrats, to shell out for smaller, less capable, less comfortable and possibly less safe vehicles." [Daily Caller, 7/21/11]

CFA: 56 MPG Standard Would Result In "Consumer Savings In Excess Of $6,000 Per Vehicle." A report by the Consumer Federation of America says the CAR study "overestimates the cost of increasing fuel economy standards" and "vastly underestimates the value of fuel savings" by, among other flaws, using a discount rate "rejected by the courts and all regulatory agencies." The report goes on to say that the "actual fuel savings are worth about three times as much as CAR concluded" and that a 56 mpg standard would result in "consumer savings in excess of $6,000 per vehicle." [Consumer Federation of America, 6/28/11]

EPA & NHTSA Estimated That Consumer Savings Will Far Exceed Cost Increases. A joint technological assessment from Environmental Protection Agency and the National Highway Traffic Safety Administration estimated that the average cost increase per vehicle for a 56 mpg standard would range from $2,100 to $2,600 – far less than the CAR study claims. Furthermore, the assessment estimated that a 56 mpg standard would provide net lifetime savings of $5,300 to $7,000 from lower fuel costs and "the initial vehicle purchaser will find the higher vehicle price recovered in 4 years or less for every scenario analyzed" for a standard ranging from 47 to 62 mpg. [Environmental Protection Agency, September 2010] MYTH: Higher Fuel Economy Standards Are "Deadly"

IBD: Raising Fuel Economy Standards Has "Deadly Consequences." From an Investor’s Business Daily article: "A USA Today report concluded that CAFE had killed 46,000 people by 1999 […] there’s no guarantee the improved standards will be less deadly. When automakers agreed with the Obama administration to hike CAFE standards to 35.5 mpg by 2016 via the reformed approach, NHTSA’s ‘worst case’ scenario put the death toll at more than 1,000." [Investor’s Business Daily, 7/26/11] Washington Examiner: "Thousands Of Americans Have Died As A Result" Of Fuel Efficiency Standards. From a Washington Examiner post by Mark Tapscott:

Since their introduction in 1975, thousands of Americans have died as a result of design changes CAFE has forced in cars and trucks, so it’s no surprise that these regulations draw some of the most impassioned critiques. What remains amazing, however, is how CAFE advocates persist in their folly despite the overwhelming evidence of the bloody toll that results. [Washington Examiner, 7/29/11]

CBO: "Death Rates From Motor Vehicle Crashes Have Fallen Steadily Over The Past Half Century." According to a 2002 report from the Congressional Budget Office, "Studies of the safety implications of corporate average fuel economy standards have produced mixed results." The CBO writes that safety implications would depend on "how raising CAFE standards would affect the size and weight of vehicles in the future," where decreasing the weight and size of cars is expected to lead to a "higher number of fatalities," while "declines in the weight of light trucks tend to decrease fatalities overall." CBO further notes:

Sorting out the impact of CAFE standards on vehicle safety is complicated by the fact that many other factors also affect safety. Death rates from motor vehicle crashes have fallen steadily over the past half century, including during the period when CAFE standards went into effect and vehicle weights declined. That trend is thought to have resulted from better vehicle designs, less drunk driving, greater use of safety belts, and improved road design. [Congressional Budget Office, November 2002]

ICCT: Structure Of New Standards Provides "Incentives For Manufacturers To Build Vehicles In Every Size Class." The argument that higher fuel economy standards will compromise safety is based on an assumption that automakers will be forced to downsize cars in order to meet new requirements. But in a recent post at The Hill, the International Council on Clean Transportation’s John German explains that the new curved fuel efficiency standards will eliminate incentives for automakers to rely on smaller vehicles to meet them:

Take one of the main carmakers’ talking points: They keep telling people that stringent standards require smaller, unsafe cars. There used to be some truth in that standards were easier to meet with smaller vehicles. But that’s simply not true now — and the carmakers know it.

The truth is that the National Highway Traffic Safety Administration and the Environmental Protection Agency are drafting rules that grade manufacturers — and the cars, trucks, and SUVs they build — on a curve. This was mandated by the 2007 Energy Information and Security Act. The proposed 56 mpg standard by the year 2025 is not an inflexible line in the sand requiring all manufacturers to make only cars, trucks and SUVs go at least 56 miles on a gallon of gas.

Instead, the new standards are designed so that each manufacturer’s goal is custom-calculated, based on that manufacturer’s own product line. An automaker that builds mostly larger cars, SUVs, and trucks will have lower mileage goals than a competitor that builds mostly compact and subcompact cars. And an SUV or truck with a larger "footprint" will not be required to get the same mileage as a small car. While the curves have not been proposed yet for 2025, the footprint curve for the 2016 standards established targets of 41.1 mpg for the Honda Fit compact car, 32.6 mpg for the Chrysler 300 full-size car, 32.9 mpg for the Ford Escape small SUV, and 24.7 mpg for the Chevy Silverado pickup truck.

Because automakers will be graded on a curve, there are incentives for manufacturers to build vehicles in every size class. The standards simply mandate that each of those vehicles, regardless of size, be as energy-efficient as possible. [The Hill, 7/27/11]

Free Press: "If The SUV Meets The Fuel Standard For Its Own Footprint, The Automaker Can Sell All It Wants." The Detroit Free Press clarifies that new fuel efficiency standards, which are based on each type of vehicle’s "footprint," will not favor small vehicles:

Most dramatic: large and small vehicles are no longer in competition with each other.

Instead, each is judged based on its "footprint" — a formula based on the distance between the axles and a vehicle’s width. There is a curve, and each footprint has its own fuel economy requirement on that curve.

The result is that automakers don’t have to balance sales of SUVs with poor fuel efficiency and subcompacts that get better mileage to meet CAFE targets. If the SUV meets the fuel standard for its own footprint, the automaker can sell all it wants. [Detroit Free Press, 7/17/11]

National Review: "Consumers Don’t Want" Fuel Efficient Vehicles. From an op-ed by the National Review’s Henry Payne: "After the dust settles, EPA’s new so-called CAFE standards will be riddled with loopholes, the auto industry and Detroit unions will get massive federal subsidies to build cars consumers don’t want, and the taxpayer will be poorer and have less product choice." [National Review Online, 7/25/11] Fox’s Varney: Fuel Economy Standards Do Not "Let Consumers Have Free Choice." From the July 5 edition of Fox & Friends:

STEVE DOOCY: When you look at what they want with the average on the fuel efficiency, really what they’re pushing are electric cars or the hybrids because those are the only cars that are even remotely close at this stage to getting that kind of —

STUART VARNEY: Isn’t it typical of this administration to say hey, you car companies, we know how to run a car industry, you will do this. And hey, you consumers, you will buy this. It’s kind of top-down, command economy. I don’t think it works […] Why don’t we let consumers have free choice as to what they want? Why don’t we do bottom-up instead of top-down? It might work better. [Fox News, Fox & Friends, 7/5/11]

While declining to talk about the details of the agreement, GM’s Washington spokesman Greg Martin said in an interview that he was pleased the two sides were able to reach a consensus.

"The talks over the last few weeks have yielded real progress, and we’re hopeful there’s a way to improve fuel economy but retain customer choice and the industry’s recent resurgence," Martin said. [Washington Post, 7/27/11]

"Global standards are good for automakers," said Alan Baum, president of Baum & Associates, an automotive forecasting firm in West Bloomfield. "If you have fewer product platforms worldwide with more volume off each platform, you make more money."

A platform, in auto parlance, is the basic underbody and suspension of a vehicle. Automakers like to build multiple types of vehicle models using as few platforms as possible.

Many worry that higher fuel economy standards will make the full-size pickup truck — an American icon — as obsolete as the big-box chain bookstore.

Not so, Baum says.

It used to be that full-size pickups and muscular V-8 engines went together like former body builder Arnold Schwarzenegger and Maria Shriver.

But, as Maria found out, there are downsides to big and brawny. Ford now offers a more fuel-efficient V-6 engine in its venerable F-150 pickup that’s proving highly popular with buyers.

Proposed fuel economy standards, like the current ones, likely will offer all sorts of wiggle room for automakers and allow them to continue producing the beloved full-size pickup. [Grand Rapids Press, 7/24/11]

Consumer Federation Of America: 75% Of Americans Support Higher Fuel Economy Standards. Following a six year study of consumer opinion and behavior, the Consumer Federation of America found that "the public overwhelmingly supports (75 percent or more) higher fuel economy standards as a general policy. This support has been strong and consistent over time." The study also found that 75 percent of respondents "would be willing to spend more for more efficient vehicles." [Consumer Federation of America, September 2010]

Union Of Concerned Scientists: 88% Want The U.S. To "Take Action Now To Increase Fuel Efficiency." A recent survey sponsored by a coalition of environmental groups found that 88% of Americans believe it is important "for the United States to take action now to increase fuel efficiency." The poll shows that 85% favor "requiring the auto industry to increase fuel efficiency," and 74% would support "the federal government requiring the auto industry to increase average fuel efficiency to 60 miles per gallon by the year 2025." Furthermore, 66% support the 60 mpg standard even if it "added $3,000 to the price of a new car in the year 2025." [Union of Concerned Scientists, September 2010]